By Jonathan Stempel

NEW YORK, – Bill Hwang, the founder of Archegos Capital Management, should spend 21 years in prison for running a market manipulation scheme that wiped out his $36 billion company and cost its lenders more than $10 billion, federal prosecutors said Friday.

Hwang, 60, faces a scheduled sentencing Nov. 20 in Manhattan federal court after being convicted in July of 10 felony charges including securities and fraud and racketeering conspiracy.

Prosecutors accused Hwang of lying to banks about Archego’s portfolio so he could borrow money aggressively and make concentrated bets on media and technology stocks like ViacomCBS, through so-called total return swaps.

Hwang amassed $160 billion in equity exposure, but was unable to meet margin requirements when prices began to fall.

This led to Archego’s demise in March 2021 and caused heavy losses for banks such as Credit Suisse, now part of UBS, and Nomura Holdings as various banks unloaded shares backing Hwang’s swaps.

Hwang did not testify during his two-month trial. He is expected to appeal his conviction.

On November 8, Hwang’s lawyers said he should not face any jail time.

The lawyers said prosecutors could not and cannot prove that Hwang’s alleged lies caused losses to banks. They also said Hwang’s age, cardiovascular disease, philanthropy and low risk of recidivism weighed against putting him behind bars.

Hwang’s co-defendant, former Archego CFO Patrick Halligan, was convicted at the same trial on three criminal charges. His sentencing is scheduled for January 27, 2025.

This article was created from an automatic news agency feed with no changes to the text.